Here's the part of the "credit crunch" I don't understand

[Coventina]

My husband and I get at least one, usually more than one, credit card offer in the mail every day!

If credit is frozen, how can this be?

[BlooInBloo]

1. frozen = expensive + higher reqs, and it mostly refers to institutional lending.

[Kurt_and_Hunter]

2. Credit at 24% is not frozen

[Coventina]

6. Point taken, but these offers advertise no interest for up to 18 months!

That seems pretty generous. Free money for over a year?

:shrug:

[endthewar]

10. This is how they scam unsuspecting people

They lure them into low or no interest credit cards. As soon as you're a day late on one payment, WHAMO, 30% interest rate.

[SoCalDem]

16. Not free.. miss ONE "due date" by even a second, and your interest rate is gone baby gone

and all that debt you piled up is now 30% or more....They often change the "due by" date earlier and earlier, so it's entirely possible to miss it.. They COUNT on that happening..

[Eric J in MN]

3. Congressman Barney Frank seems to be saying...

...that credit hasn't frozen yet, but it's on the verge of freezing. The bailout would stop that, according to him.

I disagree.

I believe the financial system will keep going with-or-without the bailout, and I want Congress to wait until we have a new president before passing any more major legislation.

[HowHasItComeToThis]

4. congress should pass nothing for bush

[Eric J in MN]

9. Yes, going along with Bush has been a proven mistake...

...whenever Congress did so for 8 years.

One of the rare times they refused to go along with Bush was on privatizing Social Security, and that was proven correct.

[samuraiguppy]

5. try applying. Odds are that you won't get

a quick approval. The offers that are being mailed out now were printed and processed weeks ago.

[Coventina]

7. Ah! Good point!

But, right now, I don't think I want any more credit.

Right now, DH & I are all about living frugally.

Or is that considered unpatriotic?

[lapfog_1]

8. Here is an example for you...

If the people who borrow money to load retail ATMs paid 18% for that money, how many retail ATMs would exist? Of the ones that do exist, what would be the fees they need to charge to stay in business?

Now extend to almost every commercial transaction in the country.

Start with revolving lines of credit for farmers and small business owners.

[Eric J in MN]

11. Unless we have hyper-inflation, it wouldn't make sense to charge that much interest.

Adding $700 billion to the national debt might slightly increase inflation. It wouldn't decrease inflation.

[wtmusic]

13. Those people pay around 5% and will continue to do so

Banks pay the overnight fed funds rate. Where do you get 18%?

[lapfog_1]

14. Overnight Fed funds are drying up.

Nobody but large banks can directly borrow from the Fed. And those banks are not lending any of their 5% short term money, even for a few hours.

See this article:

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=389x4093410

We are getting really close to the edge now.

[what0now0toons]

12. Credit crisis? Nope, not buying it! (animated bail out cartoon )

All around me I see evidence of continued commerce, nothing that seems in eminent danger. What we have a grave and growing danger of Billionaires fortunes disappearing and having them slip into the middle class, the mythical little people, no, no no, we cannot let that happen, we must give them golden parachutes so they may survive the mess THEY themselves created.
This GOP trickle down economy has shifted wealth up wards but only intermittent showers prevailed.

My new animated film tells this GOP tale, here's the link at you-tube
http://www.youtube.com/watch?v=w8arYlKgYws

and see more cartoons at www.whatnowtoons.com
This Crisis is just Economic Shock and Awe!

[WillowTree]

15. Count how many of those you get within the next month.